Maryland Transfer on Death Deed: How the 2026 TOD Law Works

For decades, Maryland property owners had limited options for passing real estate outside of probate. Life estate deeds worked but stripped the owner of full control. Revocable trusts worked but cost $1,700 to $3,000 to set up through an attorney.

That changed with the Maryland Transfer-on-Death Deed Act, effective October 1, 2026. This law allows property owners to designate beneficiaries directly on a recorded deed — keeping full ownership and control during their lifetime while bypassing probate entirely at death.

What a TOD Deed Does (and Doesn't Do)

A Transfer on Death deed names one or more beneficiaries who inherit the property when the owner dies. The critical distinction: the beneficiary gets no ownership interest while the owner is alive.

The owner can sell the property, refinance it, rent it out, or revoke the TOD deed at any time — no beneficiary consent required. The beneficiary has no legal claim until the owner's death, which also means the property stays protected from the beneficiary's creditors.

Compare that to adding a child's name to your deed as a joint owner — a common but risky workaround that gives the child immediate ownership rights, exposes the property to their creditors, and can trigger federal gift tax reporting requirements.

Recording Requirements

For a Maryland TOD deed to be legally valid, it must be:

• Signed by the property owner (the transferor)
• Notarized before a notary public
• Recorded in the county land records where the property is located — before the owner's death

That last point is non-negotiable. An unrecorded TOD deed has no legal effect, even if it was properly signed and notarized. The deed must be on file with the Clerk of the Circuit Court's Land Records Department before death.

Unlike life estate deeds, a TOD deed can typically be recorded regardless of existing municipal liens or unpaid property taxes. Life estate deeds often require all liens and taxes to be cleared before the county will accept them for recording.

TOD Deed vs. Life Estate Deed

Maryland recognizes two types of life estate deeds: one "with powers" (allowing the owner to sell or mortgage without beneficiary consent) and one "without powers" (requiring beneficiary consent for any transaction).

The tax exemption is significant. TOD deeds are exempt from Maryland's state and county transfer and recordation taxes. Life estate deeds are not — which means recording a life estate deed on a $400,000 home can cost $2,000 to $6,000 in transfer taxes depending on the county.

How to Revoke a TOD Deed

Revoking a TOD deed is straightforward: record a revocation instrument in the same county land records where the original deed was filed. The revocation must also be recorded before the owner's death.

Selling or conveying the property to someone else also effectively revokes the TOD deed, since the owner no longer holds title.

What Happens After Death

When the owner dies, the beneficiary must record a certified copy of the death certificate along with an affidavit of survivorship in the county land records. The property then transfers automatically — no probate petition, no Orphans' Court supervision, no Register of Wills fees.

The beneficiary receives the property with a stepped-up tax basis (the fair market value at the date of death), which can significantly reduce capital gains taxes if they sell the property later.

When a TOD Deed Isn't Enough

A TOD deed handles real property. It doesn't cover bank accounts, investment accounts, vehicles, or personal property. For a complete probate-avoidance strategy in Maryland, you also need beneficiary designations on financial accounts, a Payable-on-Death designation on bank accounts, and a vehicle TOD registration through the MVA (Form VR-471).

And if your estate is worth more than $5 million, you'll still need to address Maryland's estate tax — the TOD deed bypasses probate but doesn't eliminate tax liability on the overall estate value.

The Maryland Estate Planning Kit walks through each of these transfer mechanisms with fillable worksheets for tracking which assets need TOD designations, which need beneficiary updates, and which ones will still pass through probate.

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